The IWM Wrap Fee Program (the “Program”) is an investment advisory program sponsored by
IWM. The Program provides clients with the ability to trade in certain investment products without
incurring separate brokerage commissions or transaction charges.
To join the Program, a client must:
1) Complete an investor profile that describes the client’s financial needs, investment objectives, time
horizon, and risk tolerance, as well as any other factors relevant to the client’s specific financial
situation and any other supporting documentation the Program requires;
2) Complete the investment advisory wrap fee agreement (the “Agreement”) with IWM;
3) Complete a new account agreement with a custodian broker-dealer IWM approves for participation
in the Program (“Financial Institution”); and
4) Open a securities brokerage account with the Financial Institution and deposit those assets
designated for participation in the Program into the account.
After an analysis of any information provided by the client to IWM, IWM assists the client in
developing an appropriate investment strategy for the assets in their accounts. Thereafter, all
clients are encouraged to discuss their needs, goals, and objectives with IWM and to keep IWM
informed of any changes thereto. IWM contacts ongoing clients at least annually to review its
previous services and/or recommendations and to determine whether changes should be made
to their investment strategy.
Management of Your Portfolio
All clients in the Program grant IWM discretionary authority to buy, sell, and otherwise trade in
the type of securities described in Item 6, below for their accounts and to liquidate previously-
purchased securities that the client has transferred to their Accounts. Assets are managed by
IWM’s principal owner, Chris Holden.
Fees for the Program
Clients in the Program pay a single annualized fee for participation in the Program (the
“Program Fee”). The Program Fee is prorated and charged quarterly, in advance, based upon
the market value of the assets being managed by IWM under Program on the last day of the
previous quarter.
The Program Fee varies pending upon the market value of the assets under management, as follows:
PORTFOLIO VALUE BASE FEE
up to $750,000
1.15%
Next $750,000
0.95%
Next $1,000,000
0.75%
Next $2,500,000
0.65%
above $5,000,000
0.45%
IWM, in its sole discretion, may negotiate to charge a lesser Program Fee based upon certain
criteria (i.e., related
accounts, anticipated future earning capacity, anticipated future additional
assets, dollar amount of assets to be managed, account composition, pre-existing client, account
retention, pro bono activities, etc.).
Fee Comparison
As referenced above, a portion of the fees paid to IWM are used to cover certain securities
brokerage commissions and transactional costs attributed to the management of its clients’
portfolios. Services provided through the Program may cost clients more or less than purchasing
these services separately. The number of transactions made in clients’ accounts, as well as the
commissions charged for each transaction, determines the relative cost of the Program versus
paying for execution on a per transaction basis and paying a separate fee for advisory services.
Fees paid for the Program may also be higher or lower than fees charged by other sponsors of
comparable investment advisory programs. Because the firm pays for the brokerage fees, the
firm has an incentive to engage in less transactions, or transactions that cost less to the firm,
including the use of mutual funds that do not have transaction charges, but have higher expenses
to the client. The firm reviews the frequency and type of investments made in client accounts to
act in the client’s best interest.
Other Charges
In addition to the advisory fees paid to IWM, clients may also incur certain charges imposed by
other third parties, such as broker-dealers, custodians, trust companies, banks and other
financial institutions (collectively, “Financial Institutions”). These additional charges may include
margin costs, charges imposed directly by a mutual fund or ETF in a client’s account, as
disclosed in the fund’s prospectus (e.g., fund Program Fees and other fund expenses), fees and
commission for assets not held with the Financial Institutions offered in the Program such as
401(k) or 529 plan assets as well as for fees for trades executed away from that Financial
Institution (a conflict of interest exists where the firm avoids expenses by trading through a
different Financial Institution), mark-ups and mark-downs on fixed-income transactions
which cannot be paid by the firm (or it is overly burdensome to determine the amount of such
mark-ups / downs), deferred sales charges, odd-lot differentials, transfer taxes, wire transfer and
electronic fund fees, and other fees and taxes on brokerage accounts and securities
transactions.